Earnings Miss: Nikon Corporation Missed EPS By 56% And Analysts Are Revising Their Forecasts

Nikon Corporation (TSE:7731) shareholders are probably feeling a little disappointed, since its shares fell 2.1% to JP¥1,765 in the week after its latest interim results. It looks like a pretty bad result, all things considered. Although revenues of JP¥313b were in line with analyst predictions, statutory earnings fell badly short, missing estimates by 56% to hit JP¥16.28 per share. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

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Following last week's earnings report, Nikon's eleven analysts are forecasting 2026 revenues to be JP¥692.0b, approximately in line with the last 12 months. Per-share earnings are expected to jump 150% to JP¥64.58. Before this earnings report, the analysts had been forecasting revenues of JP¥696.6b and earnings per share (EPS) of JP¥66.80 in 2026. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a minor downgrade to their earnings per share forecasts.

Check out our latest analysis for Nikon

It might be a surprise to learn that the consensus price target was broadly unchanged at JP¥1,537, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Nikon analyst has a price target of JP¥2,100 per share, while the most pessimistic values it at JP¥1,000. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

Of course, another way to look at these forecasts is to place them into context against the industry itself. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 1.0% by the end of 2026. This indicates a significant reduction from annual growth of 9.4% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 1.5% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Nikon is expected to lag the wider industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. The consensus price target held steady at JP¥1,537, with the latest estimates not enough to have an impact on their price targets.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for Nikon going out to 2028, and you can see them free on our platform here.

Even so, be aware that Nikon is showing 4 warning signs in our investment analysis , and 1 of those shouldn't be ignored...

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.